Many thought California’s high-speed light rail plan would never happen after encountering numerous issues and growing budgets, but Donald Trump put yet another kink into their plan.

The Trump
administration cancelled nearly $1 billion Thursday in federal money for
California’s high-speed rail project, further throwing into question the future
of the ambitious plan to connect Los Angeles and San Francisco.

California Gov. Gavin
Newsom immediately pledged to take the administration to court, though the
state has not yet filed a lawsuit.

The “action is illegal and
a direct assault on California,” Newsom said in an emailed statement. “This is
California’s money, appropriated by Congress, and we will vigorously defend it
in court.”

The official word of the
funding cancellation by the Federal Railroad Administration came several months
after President Donald Trump first threatened to withdraw it.

His comments came in
response to Newsom shifting the project’s immediate focus to a 171-mile stretch
of track in the Central Valley, saying there currently wasn’t a path for the
full line.

Newsom later said he was
still committed to building the entire line but wanted to take a “building
blocks” approach that first created a working line in the Central Valley.

The state has only about
$20 billion available for the project at this time, far short of the estimated
$77 billion it would take to complete it.

Newsom has characterized
Trump’s threats to the project as retribution against California for resisting
various Trump administration policies.

While the $929 million is
a critical piece of the funding plan, the state did not plan to spend it until
2021. If a court battle over the money drags on, that could put the state in a
position to win back the money or get more from the federal government if
Democrats win the White House and control of Congress in 2020.

“Losing a billion is, I
would say, devastating to the overall project,” said Russ Fong, the project’s
outgoing chief financial officer. “We have time to hopefully come to some type
of resolution before those dollars are actually needed.”

Republican Assemblyman Jim
Patterson, who represents Fresno and is one of the project’s harshest
critics, said the state is witnessing “the beginning of the end” for
high-speed rail.

The Trump administration
has also threatened to make California return $2.5 billion that has already
been spent on the project.

California was awarded a
total of $3.5 billion from the federal government nearly a decade ago. Keeping
the money is contingent on the state completing a 119-mile segment of track in
the Central Valley by 2022 as well as environmental reviews on the entire
520-mile line.

Rail officials have said
they were poised to make that deadline and that revoking the funds was
premature.

Federal officials said
California has repeatedly
failed to make “reasonable progress” and had abandoned the original vision
for the rail line.

The state “has not
demonstrated the ability to complete the project, let alone deliver it by the
end of 2022,” Ronald Batory, administrator of the railroad administration,
wrote in a letter to rail officials.

The $1 billion represents
about one-twelfth of the money the state was counting on to pay for the initial
119-mile stretch of tracks.

California voters first
approved nearly $10 billion in bonds for the high-speed rail project in 2008,
and it’s been plagued by cost overruns and delays since. It’s been paid for
with federal money, bond dollars and revenue from the state’s cap-and-trade
program that requires polluters to pay to emit greenhouse gases.

On the low end of
cap-and-trade projections, the state would bring in just enough money to
complete the segment of track Newsom is promoting in the Central Valley. In
that scenario, losing the $1 billion in federal money would leave the state
short of funds.

If cap-and-trade revenues
come in on the high end, the project should be fine, Fong said.

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